08.08.2018

Strong first half for Rami

Finnish international rental group Ramirent has reported a solid first half with a substantial jump in profits

Total revenues for the first six months to the end of June were seven percent higher than in the same period last year at €362.6 million. With pre-tax profits jumping 48 percent to €43.2 million.

Moving to the second quarter, revenues were also seven percent higher at €186.4 million, with growth recorded in all five regions, led by Sweden at 11.1 percent and East Europe which recorded 10.5 percent sales growth. Pre-tax profits were 47.5 percent higher at €23.9 million with a strong improvement in all five regions, led by 27.3 percent in East Europe, 14.8 percent in Sweden and 13.9 percent in Finland.

Capital expenditure for the period was €110.7 million almost 18 percent up on the first half of 2017.

Chief executive Tapio Kolunsarka said: "Second quarter results materialised broadly as per our internal expectations and we delivered the seventh consecutive quarter of profit improvement. Strong net sales growth continued in the quarter at seven percent or 10.1 percent at comparable exchange rates. At the same time, our EBIT increased by 34.3 percent with EBIT margin improving to 14.3 percent.”

“All our segments increased their net sales and profitability in the second quarter. Sweden delivered again excellent growth in both rental and especially service sales in large projects. Performance in Eastern Europe continued strongly, this time particularly in the Baltic countries. In Finland, profitability improved despite somewhat slower top line growth. In Norway, we saw an upturn in sales and solid profit improvement with EBIT-margin approaching double-digit level. In Denmark, our performance improved as per our expectations.”

“After the review period, on 30th July, we signed an agreement to divest our Temporary Space business to Procuritas Capital Investors VI Holding AB. This is a logical step in our strategic path to focus on capital efficient profitable growth in our core equipment rental business. We believe that this transaction will support the Temporary Space business to achieve its full potential under the new focused ownership and it enables us to direct our growth investments into higher yielding areas in our core business.”

“Market outlook for the second half of the year remains positive as activity levels are good in all of our markets. Our organisation's execution ability remains solid and we are in a good position to continue to pursue profit improvement. However, it needs to be highlighted that the second half and especially third quarter of last year were very strong, making the comparisons ahead of us tougher to beat."

Vertikal Comment

An first class set of numbers from Ramirent which does seem to be getting its ‘mojo’ back with profitability for the first half closely mirroring the other big Finish international rental group Cramo for the six months.

The sale of its Temporary Space division should help improve focus and resources for its key equipment business which will hopefully see this upward trend continue. If the current positive trend continues the company might well come close to achieving its first €800 million year, but this depends on when the Temporary Space business drops out.

All in all an excellent first half